Thursday, August 2, 2012

Cyprus Tourism - Head in Sand Time?

On January 10th Ryan air announced it would offer 80 flights a week to 14 new destinations, investing in Cyprus nearly 110million euros to bring 600.000 passengers a year and provide jobs for 600 people.
The airline was the first to take advantage of the governments new incentives to boost tourism which included a substantial drop in landing fees.

Described by the head of the CTO as ‘the start of huge potential for Cyprus’-and as ‘a watershed for Cyprus’ -by Ryan Air deputy chief Michael Crawley.

Every thing seemed to be moving in the right direction for both parties, with an agreement which was mutually beneficial, assuring in the main a sustainable and long term relationship between the Cyprus Tourism Organisation and Ryan Air.

Eight months down the line cracks are beginning to show with threats from Ryan air to ‘pull the plug’ on Cyprus and so dissolve their partnership.

The original agreement between the Cyprus Tourism Organisation (CTO) and the airline, as explained by Mr Orountiotis President of the CTO is the same agreement they have struck with other airlines and tour operators.

Now, Ryan Air are threatening to close Larnaca flights due to high fuel costs and are claiming a 100% increase on the promotion fees the CTO is offering.

A somewhat predictable scenario given the standard operating policy of Ryan air and their prime objection of ‘route profitability’.  Ryan Air has played this card many times before and they will continue to do so, for that is their avowed strategy.

Sadly, the history of Tourism in Cyprus reads a bit like Groundhog Day with the powers that be always repeating the same mistakes, mainly in their inability to practice the art of flexibility, to be able to look ahead with regard to the countries need to diversify its source markets, all without creating a structure of total dependency on either tour operators or airlines.

A roll back in time shows us what happened - the demise of Cypriana holidays in the 1990’s followed by the inevitable bankruptcy of Libra holidays, not forgetting our national carrier- Cyprus Airlines -which now looks perilously close to flying off into the sunset never to return.

The Republic of Cyprus has long subsidised our ailing national carrier, as well as promoting an over protectionist routing policy. Cyprus has to now waken up to the fact that routes need to be substituted by an open skies policy which can then turn the country into a profitable destination for every foreign airline.
We would then experience not only healthy competition but it would also allow increased interest to develop new source markets.

The grim facts have to be faced as Cyprus Airways is now one wing tip short of bankruptcy, and an open skies policy will most certainly send it into a fatal nose dive.

This of course would then leave politicians of all political parties brutally exposed, and that’s why the powers that be will not be available for an honest and open debate on this very important if not vital change to our current tourism policy.